Branded apparel and footwear company Jones Apparel Group Inc has reported a 29 per cent drop in second-quarter earnings and has launched a strategic review of operations in a push to cut costs and boost profit margins.

The company said earnings for the quarter ended 2 July fell to USD54.8 million from USD77.6m in the year-ago period on poor demand for wholesale footwear, accessories and junior denim.

Second-quarter revenue grew to USD1.18 billion from USD1.05bn in the same period last year, boosted by the acquisitions of Maxwell Shoe and Barneys New York.

Peter Boneparth, president and chief executive officer, said: "Our second-quarter financial performance was generally consistent with our expectations. The wholesale better apparel businesses, Gloria Vanderbilt moderate apparel business and Barneys New York retail business each exceeded their plan."

The company announced a strategic review of its operating infrastructure to improve profitability, and increased its dividend to reflect its strong financial position.

Boneparth commented: "By proactively reviewing our infrastructure, systems and operating processes at a time when the industry is undergoing consolidation and change, we plan to eliminate redundancies and improve our overall cost structure and margin performance."

The Company is reducing its expected 2005 full-year revenues to a range of USD5.0 billion to USD5.1bn.

Jones Apparel Group Inc is a leading designer, marketer and wholesaler of branded apparel, footwear and accessories.